Bethlehem Steel Co. officials verified yesterday that the company will receive a $114 million cash refund from the U.S. Treasury against taxes it paid in 1974 under a complex loss recovery provision of the Internal Revenue Code.
The cash refund is part of its $463 million tax credit resulting from its massive $448.2 million net loss last year, the company said. The carry-forward provision for the 1977 loss should give the company another $300 million in tax credits to apply against future income taxes.
The Pittsburgh Post-Gazette reported yesterday that Treasury sources said the company may not be liable for federal income taxes for up to nine years, depending on the business improvements it makes.
The company laid off thousands of employes at its Johnstown, Pa., and Lackawanna, N.Y., plants last year after weather conditions and low-cost imports combined to hurt Bethlehem's sales.
In a formal statement released late yesterday in response to the article. Bethelhem said, "A substantial part (pensions, Social Security and layoff ($202 million) of the tax credit is attributable to employment costs (pensions, Social Secirity and layoff costs) which were incurred on behalf of employes affected by the shutdown of certain facilities in 1977, but which[WORDS ILLEGIBLE] deductions until cash payments are made.
"These payments wi'l be made over an extended period of years and will result in some allowable tax deductions in the five-year period after 1977 as well as in later years," the firm said.
"The extent of Bethlehem's income tax liability in the future will depend upon business conditions existing at that time," the statement concluded.